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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (76620)	2/27/2000 8:17:00 AM
From: Earlie	Read Replies (1) \| Respond to of 132070

Zeev: Good points on all counts. We will have to agree to disagree on some of them.. I agree with you that it is much easier to be a bear on RMBS at current levels than two weeks ago. (g) Fortunately, I have been ultra slow in coming out of the weeds, so the exposure at this end is still tiny. I was getting "antsy" to do something about it just as the short squeeze commenced. Once it was underway, I knew it would be bloody, as the short position was huge, so I have just been a spectator waiting for the cannon fodder to be exhausted (Having been part of "cannon fodder" situations in the past, I have some awareness of the pain it can bring.). (g) On the back side of this run up, there should be a nice retrenchment, in which hopefully I will have a chance to participate. Your price calls were excellent. We do agree on both the PE and the probable earnings for 2001. I see the market helping out by generically shrinking the current crazy PEs as the stealth bear becomes more visible. PEs across the PC/semi sector in particular should shrivel as PC revenue growth continues its multi-year slide. Obviously there are plenty of other excellent short targets, particularly in the PC/semi sector. That said, I still see RMBS as one of the best. The only worry all along has been the size of the short position. Yet even this is a good sign, so long as one is patient. The extraordinary enthusiasm of the shorts for this stock speaks volumes about the company's fundamentals. It is a rare event when the homework of the shorts is not superior to the homework of the longs. Intel is another area where we will have to agree to disagree. I used to admire this company, but no longer. Their accounting is an affront to investor intelligence, and no matter how one cuts it, they blew a remarkable monopoly situation through shear ineptitude. I would be the last to criticize their manufacturing capabilities, but product innovation has been minimal for years. On top of that, their actual operating earnings growth has been almost non-existent for two years, yet the stock price has ballooned. To its credit, the company recognizes that it has to quickly find alternatives to microprocessor manufacture, as this sector completes the "commoditizing" process, but what to do? So far, it has invested cash in several other businesses. Will this strategy work out? Time will tell. I don't think the big PE stands up as the investing public comes to understand that the company's main activity, micro production, has become commoditized and crowded. I also think the PE takes further hits once the public recognizes that Intel's growth is ending, due to its dependence on PC sales. PC revenues are flattening out, and PC growth is tapering off. Intel will have difficulty dodging the fall out from this situation. In this context, Intel's comments about production expansion appear mad. The industry already has too much capacity. More makes no sense and would compound an already worrisome situation. I suspect those comments are smoke. Intel's execs are not that daft. We both agree that the two companies need each other. I just don't see Intel continuing the marriage if the market doesn't want to buy RMBS products. The huge "enticement" cheques provided by Intel also speak to the lack of enthusiasm for RMBS among the producers. I also wonder how Intel expects to get a decent return on a billion dollars worth of enticement fees. The only way IMHO is through RMBS stock sales, as current trends in the PC market suggest that it would take one heck of a long time to get this dough back through product sales. Intel saw RMBS as a means to re-establish its monopoly status. The box builders will go to any lengths to prevent this. Even if RMBS was a wonder product (and it is not), the box builders would embrace any viable alternative just to avoid another round of the Intel dictatorship. The suit looks to me like a desperation move. It makes no sense to sue the guys you hope will produce your products. Even if the case had merit, it won't matter as it will get strung out in legal procedures for years. RMBS' pockets are not deep enough. As well, in this game the technology will have long since moved on. Best, Earlie

To: Zeev Hed who wrote (76620)	2/27/2000 8:53:00 PM
From: Michael Bakunin	Respond to of 132070

I don't have the necessary overview of prior art, but just because something's in a patent doesn't mean it holds up on appeal. With Rambus's lawyers making noises about all SDRAM, not just DDR, you've got to think Hitachi's motivated not to settle, but to win. They've got awfully deep pockets. -mb eet.com "The patents involve 141 different technologies that are fundamental to synchronous DRAMs and microprocessors, including delay lock loops (DLLs), double bus rate technology, and two-bit prefetch architecture technology. The technologies apply to synchronous DRAMs, modules, and microprocessors which interface with synchronous DRAMs, Rambus said."